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Labour and the property and mortgage markets: "1.5m houses don't build themselves and affordability won't be transformed overnight”

ended 05. July 2024

Following the Labour Party winning the General Election, Newspage asked property and mortgage experts for their views on what the ramifications could be for the mortgage and property markets, based on its manifesto. One, Michelle Lawson, said “1.5m houses don't build themselves and affordability won't be transformed overnight”, while a second, Stephen Perkins, added: “What matters now is how Labour will fund and deliver their stated housing policy.” A third, Kim McGinley, said simply: “The UK housing crisis is as definitive as Labour's election win. The new government will be judged on what they do next. The manifesto contained words but now we need action to solve what has been a decades-long issue.” A fourth added: “We don’t need an annual housing minister and need to stop the merry-go-round.” Their views are below.

14 responses from the Newspage community

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Harps Garcha
Director at Brooklyns Financial
With the election now over, whether you're over the moon with the result or feeling let down, we've got some stability for at least the next five years, well hopefully. Those who have been waiting in the wings can finally put their plans into action. The property market is in a real mess, and Labour has a huge challenge ahead to steer private entities to focus on what's best for the sector, rather than just lining their pockets. It's time to stop talking the talk and start walking the walk.
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Bob Singh
Founder at Chess Mortgages
The Government needs to bring stability to the housing sector quickly and should consider making some departments, including housing, non-political and external. We don’t need an annual housing minister and need to stop the merry-go-round. Let’s hope change has begun. With mortgage rates on the way down, inflation finally tamed and a potential base rate cut looming, Keir Starmer's job has been made a lot easier. The NHS, law and order, housing, welfare and education will be other priority areas to focus on. More generally, this historic win for Labour signals change for this country and demonstrates clearly the power of democracy.
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Kim McGinley
Director & Specialist Broker at VIBE Finance
The UK housing crisis is as definitive as Labour's election win. The new government will be judged on what they do next. The manifesto contained words but now we need action to solve what has been a decades-long issue. Only time will tell if Labour can fulfill any of their promises on the critical issue that is housing. In the UK we have become accustomed to volatility over the past few years but the mortgage market has remained resilient through tough times. We are entering yet another era of change and we will need to adapt accordingly. What's clear from the election is that the public have lost confidence in politics so I wouldn't necessarily say the Labour Party 'won'.
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Michelle Lawson
Director at Lawson Financial
Honesty and integrity have been lost in politics and while there has been a landslide win for Labour, Keir Starmer has now got a momentous uphill struggle to meet his promises in the manifesto. 1.5m houses don't build themselves and affordability won't be transformed overnight. The General Election result, if nothing else, is a huge lesson for politicians to listen to the public who vote for them. Let’s be honest, Labour’s celebration is realistically a vote where the public got the best of the worst.
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Stephen Perkins
Managing Director at Yellow Brick Mortgages
There were no real surprises in the overall outcome of the General Election. What matters now is how Labour will fund and deliver their stated housing policy. We will have yet another housing minister, who will hopefully finally bring stability to the role. Everyone in the mortgage industry would have enjoyed seeing Truss’ deserved defeat following her trashing of the economy. Much of the pain many are now experiencing was caused by the disastrous mini-Budget and the Tories are now paying for it.
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Ben Perks
Managing Director at Orchard Financial Advisers
A Labour landslide was priced in months ago so Friday's election result shouldn’t rock the boat too much. I’d expect that, as the Tories clear their desks, mortgage rates will continue to trickle downwards. All eyes now turn to Rachel Reeves to steer this ship into steadier waters for borrowers. The next meeting of the Bank of England's Monetary Policy Committee in August will arguably have a more immediate impact on the property and mortgage markets if the outcome is a cut to the base rate.
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Craig Fish
Director at Lodestone Mortgages
Labour now have a real opportunity to correct all the wrongs in the UK, one of the biggest being the housing market. They will be under scrutiny like no party has ever been before. If they get things right, the housing market could be very busy going forwards. But after last night's result, all parties need to take a long hard look at themselves and really deliver for the public instead of putting themselves and their egos first.
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Simon Bridgland
Director at Charwin Private Clients
It's time for real and purposeful action around housing now, not political rhetoric. Too many Governments have failed to solve the housing crisis as even the best plans rarely survive contact. Larry the cat will have a new owner in Number 10, and now it's imperative that Labour owns the UK's endemic and deep-rooted housing problem.
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Justin Moy
Managing Director at EHF Mortgages
The dynamic of the property market won’t change overnight but having a different perspective on housing will at least be a breath of fresh air. The weeks and months ahead will be a barometer as to whether Labour truly want to deliver on housing, or will simply tread water for the next five years like countless other administrations. New build developments need to cater for single first-time buyers, and mortgage rates need to fall to help all borrowers. That’s where you need to deliver Keir.
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David Stirling
Independent Financial Advisor at Mint Wealth
The landslide victory of Labour should hopefully lead to a BoE base rate cut in August which should further increase the recent cut-throat competion from the lenders. All of this should be great news for those considering buying soon but we really need some policy injection into these mortgage guarantee incentives to get proper momentum in the property market in 2024. However things are definitely looking more optimistic all round.
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Samuel Mather-Holgate
Independent Financial Adviser at Mather and Murray Financial
This is a momentous moment for the UK's homeowners and those who aspire to get on the property ladder. Finally we will have a government focused on stimulating a stagnant housing sector. Expect to see incentives for buyers, builders and even sellers. This is the most important way of getting the economy moving that will allow Starmer to push the agenda for change so many people voted for. Farage will be the most delighted of all leaders. This may push a broken Tory party further right and put Starmer in power even longer to deliver a long-term strategic housing and growth plan.
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Dariusz Karpowicz
Director at Albion Financial Advice
Labour's win and Keir Starmer as PM signal potential shake-ups for the property and mortgage markets. Their manifesto promises to tackle the housing crisis with 1.5 million new homes and prioritise first-time buyers over international investors. However, these grand promises may lead to more regulation against smaller landlords, rent controls, and other ideas that aren't favourable for landlords, investors or the wider property market. While the goal to get Britain building sounds great, the reality could bring rocky times ahead for the market. Empty promises or genuine change?
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Graham Cox
Director at Bridging Hub
Labour's ambition to build 1.5 million new homes over the next five years is laudable. But making the Mortgage Guarantee Scheme a permanent measure is in my view, entirely counterproductive. What young people and first-time buyers need are lower house prices. That would automatically reduce the deposit amount borrowers need to find. Not demand side measures that simply accept the status quo as irrevocable. It will only serve to prop up prices, just like the Help to Buy scheme did as soon as it was introduced in 2013.
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Jai Khandpur MRICS
Investment Manager at IP Global
The policies are commendable but it’s about how they will actually be able to act on them. Labour's goal of building 1.5 million new homes in five years is ambitious, because historically they have missed housing targets. Planning permission needs to be drastically improved, as fewer than 70,000 planning applications were approved in late 2023, marking a record low and indicating significant delays. Interest rates will continue to trickle down, which is something. The win for Labour was ultimately priced into the market ages ago.